February 8, 2005 (Broadcast #08-011) President Bush Releases the FY 2006 Budget – President Bush released his $2.57 trillion budget to Congress Monday, a proposal strongly prioritizing the Department of Defense while attempting to halve the deficit by 2009. The following legislative update provides a preliminary overview of the President’s budget as it affects tribes in setting the nation’s fiscal course for the year. The entire budget is available on-line at www.whitehouse.gov/omb/budget/fy2006 . If you have any questions, contact Amber Ebarb at aebarb@ncai.org or call 202-466-7767. Budget Overview The almost 2,500 page budget proposes an overall increase of 2.1% in all foreign and domestic discretionary spending, which lags behind the projected 2.3% annual rate of inflation. In the tightest budget submitted to Congress of this Presidency, the Administration proposes to cut all discretionary domestic spending outside of national security by 0.7%, with proposed funding for foreign aid rising by 17%. For Defense, the spending blueprint would provide 4.8% over the FY 2005 enacted level, an increase of $19.3 billion which exceeds the net $17.6 billion increase for discretionary spending as a whole, the appropriated funding Congress controls each year. The President’s budget requests deep cuts and flat funding for non-military discretionary programs, which make up less than 20% of the entire budget, to finance Defense increases and to reduce the deficit. The President also proposes to eliminate 150 non-military programs, with 48 in the Department of Education, that the Administration deems ineffective. The spending plan does not provide for the future expenses of the military operations in Iraq and Afghanistan, estimated to cost up to $80 billion more, nor does the plan include the transition costs of restructuring Social Security to set up private accounts. The proposal also assumes that the temporary tax cuts enacted over the past several years will remain in effect after their expiration dates. Of the 16 Cabinet level agencies, nine will receive reductions with the steepest cuts slated for the Department of Housing and Urban Development. Below is a snapshot of proposed budget authority levels by agency for FY 2006, followed by analysis of the proposals for specific programs relevant to tribal governments and American Indians and Alaska Natives. Discretionary Budget Authority
Agency ($ in billions) Agriculture Commerce Defense Education Energy Health and Human Services FY2005 Estimate 21.4 6.3 400.1 56.6 23.9 69.2 FY2006 Proposed 19.4 9.4 419.3 56 23.4 68.9 % Change -9.6% 49.0% 4.8% -0.9% -2.0% -0.5%
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Agency ($ in billions) Homeland Security Housing and Urban Development Interior Justice Labor State/International Assistance Transportation Treasury Veterans Affairs Environmental Protection Agency Corps of Engineers National Aeronautics and Space Admin. Social Security Administration
FY2005 Estimate 29 32.2 10.8 20.2 12 27.5 12.7 11.2 30.6 8 4.7 16.1 7.5
FY2006 Proposed 29.3 28.5 10.6 19.1 11.5 31.8 11.5 11.6 31.3 7.6 4.3 16.5 7.7
% Change 1.2% -11.5% -1.1% -5.5% -4.4% 15.7% -6.7% 3.9% 2.1% 5.6% -7.2% 2.4% 2.8%
Bureau of Indian Affairs
The Bureau of Indian Affairs budget request is $2.2 billion, a level $108.2 million below the FY 2005 enacted amount. The Operation of Indian Programs would receive $1.9 billion, a $1.9 million decrease. Significant changes in the BIA budget include increases for Public Safety and Justice, Indian Education and School Construction, and a proposal to restructure the BIA Operation of Indian Programs account. The below table outlines funding levels, followed by highlights of key changes and initiatives.
BIA Funding Table (in thousands) BIA Operation of Indian Programs Tribal Priority Allocations Other Recurring Programs Non-Recurring Programs Central Office Operations Regional Office Operations Special Programs/Pooled Overhead Total – Operation of Indian Programs BIA Construction Education Public Safety and Justice Resources Management General Administration Construction Management Total – BIA Construction Indian Land and Water Claims Settlements Miscellaneous Payments To Indians Indian Guaranteed Loan Program Total – Department of Interior, BA FY 2004 Actual 770,634 614,723 76,228 88,506 63,685 280,101 1,893,291 294,954 4,983 38,678 2,156 6,056 346,827 59,866 6,417 10,880,000 FY 2005 Enacted 769,543 612,919 75,985 140,021 41,362 286,261 1,926,091 263,372 7,381 40,289 2,126 5,961 319,129 44,150 6,332 10,864,000 FY 2006 Request 760,149 602,301 65,325 151,534 41,590 303,331 1,924,230 173,875 11,777 38,272 2,136 6,077 232,137 24,754 6,348 10,763,000 Change: 2005 enacted -9,394 -10,618 -10,660 +11,513 +228 +17,070 -1,861 -89,497 +4,396 -2,017 +10 +116 -86,992 -19,396 +16 -101,000
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Operation of Indian Programs Law Enforcement Increases in Special Programs/Pooled Overhead – The FY 2006 Interior Budget in Brief notes the poor conditions documented in the September 2004 Office of Inspector General report on Indian Detention facilities, as well as the expiring Department of Justice Community Oriented Policing Services grants program. The BIA budget includes a $19.2 million increase in funding to: 1) expand law enforcement programs in areas where violent crime is most severe and COPS grants are due to expire; 2) staff, operate, and maintain detention facilities built with Department of Justice funding which will be certified for occupancy in 2006; 3) outsource detention of individuals to local jurisdictions where BIA facilities do not comply with national standards; and 4) begin a comprehensive program to improve and repair BIA detention facilities. Within OIP funding, Special Programs and Pooled Overhead would rise by $17 million with increases requested for the following: $4.086 million for operational costs for new detention centers; $3.2 million for operations and maintenance of existing detention centers; $5 million to outsource detention of detainees to local jurisdictions in places where BIA facilities are non-compliant; and $2.5 million to expand law enforcement programs in areas where violent crime is most severe. Operation of Indian Programs: Budget Restructuring – “In an effort to improve budget and performance integration, BIA is proposing a revised budget structure for the Operation of Indian Programs account. By grouping programs by function rather than organization, the proposed structure will facilitate performance measurement and improve program management. The revised structure will also greatly simplify the budget and reduce the number of line items by 50 percent” (FY 2006 Interior Budget in Brief, BH – 84). Reforming Tribal Priority Allocations – “Indian Tribes are becoming more business-oriented and are seeking more control over their lands and economic and cultural decisions. In addition, BIA is helping to expedite key energy and mineral resource development opportunities through the timely processing of joint-venture development and lease agreements. The Administration believes TPA could be improved by targeting funding to the areas of greatest need.” (FY 2006 Budget of the U.S. Government, p. 190). “The funding process used today is a formula allocation based on historical funding levels established in the early 1970s, and h as remained essentially the same. In an effort to improve program accountability and to ensure that funding is targeted to the areas of greatest need, the Department will evaluate the allocation of funds within the TPA program and consult with Tribes to examine ways to better distribute TPA funding” (FY 2006 Interior Budget in Brief, BH – 86). TPA Reductions – TPA would be reduced $9.39 million from FY 2005 enacted levels, and would include the following reductions due to “lack of accountability, duplication of other Federal or State programs, and implementation of management efficiencies”: -$6.42 million to welfare assistance, -$8.84 million to Johnson O’Malley Grants, -$1.162 million to community fire protection, -$.431 million to energy development grants, -$1.8 million to probate, and -$1.41 to administrative services at the agency office level. Central Office Operations – Central Office would receive an $11.5 million increase, the largest proportionally in the OIP account, with $8 million requested to process probate cases. $.5 million would establish an economic development commission. Indian Education – $2 million is requested under Other Recurring programs for pilot leadership academies at Indian schools. A $9.766 million decrease is proposed for Tribally Controlled Community Colleges. Construction -- The budget proposal includes an $89.5 million cut for school construction. The proposed budget of $173.9 million will fund “the second school on the priority list, Porcupine Day School in South Dakota, and phase I of the third school on the priority list, Crownpoint Community School in New Mexico.”
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Office of Special Trustee for American Indians The 2006 request for Office of Special Trustee (OST) accounts totals $303.9 million, with a proposed net increase of $113.6 million for trust improvements.
(in thousands) Office of Special Trustee Indian Land Consolidation Program FY 2004 Actual 187,304 21,709 FY 2005 Enacted 191,540 34,514 FY 2006 Request 269,397 34,514 Change from 2005 enacted 75,857 0
Historical Trust Accounting – A significant increase would provide funds to continue conducting a historical accounting of both individual and tribal accounts, an increase of $77.8 million. Within OST is $135 million for the Office of Historical Trust Accounting, a level based on “an estimate of the Department’s costs to continue implementation of the Historical Accounting Plan for Individual Indian Money Accounts. This amount may be revised depending on the outcome of the court rulings in Cobell v. Norton and congressional action, which could potentially delineate the specific historical accounting obligations of the Department.” Indian Land Consolidation – No increases were requested for the Indian land consolidation program from the FY 2005 enacted level. NCAI continues to support this program, an investment in which will do more to save on future trust administration costs than any other item in the trust budget. Indian Health Service The 2006 budget request for IHS is $3.8 billion, a net increase of $72 million over FY 2005. Increases in the budget include: Clinical Services ($128 million increase); Contract Health Services ($27 million increase); Preventive Health ($9 million increase); Sanitation Construction ($2 million increase); Facilities and Environmental Health Support ($9 million increase); and $1 million increases each for Urban Health, Direct Operations, and Indian Health Professions. The President’s budget also calls for a $23 million increase to staff new outpatient clinics. The funding request remained level for Tribal SelfGovernance and Diabetes Grants. The Administration’s budget proposes to decrease the amount of funding for Health Care Facilities Construction by $86 million. IHS Funding Table (in millions)
Indian Health Service: Clinical Services Contract Health Services (Non-Add) Preventive Health Contract Support Costs Tribal Management/Self-Governance Urban Health Indian Health Professions Direct Operations Diabetes Grants Subtotal - Services Program Level Indian Health Facilities: Health Care Facilities Construction Sanitation Construction Facilities & Env. Health Support Maintenance & Improvement Medical Equipment Subtotal - Facilities Program Level Total - Program Level
FY 2004 Actual
2653 479 107 267 8 32 31 61 150 3309 94 93 138 55 17 397 3706
FY 2005 Enacted
2723 498 110 264 8 32 30 62 150 3379 89 92 142 55 17 395 3774
FY 2006 Request
2851 525 119 269 8 33 31 63 150 3524 3 94 151 56 18 322 3846
Change: 2005 enacted
128 27 9 5 0 1 1 1 0 145 -86 2 9 1 1 73 72
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Health and Human Services The FY 2006 budget totals $642 billion in outlays, an increase of $58 billion, or 5.8 percent over the comparable FY 2004 budget. The discretionary portion of the HHS budget totals $67 billion in budget authority. Highlighted below are some of the programs affecting tribes within HHS. HHS Funding Table ($ in millions) Administration on Aging Aging Grants for Native Americans Administration for Children and Families Head Start Promoting Safe and Stable Families Child Welfare Services Administration for Native Americans Health Resources and Services Administration Community Health Centers Ryan White AIDS National Institutes of Health Minority Health and Health Disparities Diabetes and Digestive and Kidney Diseases Substance Abuse and Mental Health Services Admin. FY 2005 Enacted 26 6,843 98 290 45 6,809 1,734 2,073 196 1,864 3,269 FY 2006 Request 26 6,888 105 290 45 5,972 2,038 2,083 197 1,873 3,215 Change from 2005 enacted 0 45 7 0 0 -846 304 10 1 9 -54
Head Start -- The budget request is $6.8 billion, reflecting a proposed $45 million increase. Tribes receive a 2.9% set-aside of Headstart funds. Administration on Native Americans – The Administration on Native Americans budget request remained constant with FY 2004 and 2005 budget requests at $45 million. Housing and Urban Development The Administration requested a few increases, such as for Title VI Loan Guarantee, but fail to offset the proposed losses for Indian Country. Currently in the FY 2005 appropriations, the Indian Community Development Block Grant (ICDBG) is funded at $68 million and the Native American Housing Block Grant is funded at $622 million for combined $690 million for Indian housing. The President proposes rolling the ICDBG into the Native American Housing Block Grant for a combined total of $583 million, which would translate into a loss of $107 million in housing for Indian Country. The ICDBG will stay in the Department of Housing whereas the other CDBG programs will move under the Department of Commerce. HUD Funding Table (in millions) Indian Housing Block Grant Title VI Loans Section 184 Indian Housing Loan Guarantee Prgm Indian Community Development Block Grant Rural Housing and Economic Development Empowerment Zones/Enterprise Communities FY 2003 Enacted 649 2.0 5.3 71.0 25.0 30.0 FY 2004 FY 2005 Enacted Enacted 654.1 627.0 2.0 2.0 5.3 5.0 72.0 69.0 25.0 24.0 15.0 10.0 FY 2006 Request 582.6 4.8 2.65 ----
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Department of Education The budget request under the Indian Education Act is $120 million, the same amount enacted in FY 2005. There is a shift in the funding within the Acts divisions. A $1.1 million dollar increase is requested for grants to local educational agencies, taken from the budgeted amount for research, evaluation and data collection. A decrease of $10 million is proposed for education programs benefiting Native Hawaiians and Alaska Natives, including a $5.4 million decrease for strengthening Alaska Native and Native-Hawaiian-serving institutions. Education ($ in thousands) Impact Aid Indian Education Act Formula Grants to LEAs National Activities (Research, Eval., Data) Special Programs (incl. Indian Teacher Corps) Education for Native Hawaiians Alaska Native Education Equity Assistance Program Strengthening AN, Native HA-Serving Institutions Strengthening Tribal Colleges Tribally Controlled Postsecondary Institutions Department of Veterans Affairs Department of Veterans Affairs is requesting a record $70.8 billion in the fiscal year 2006 budget for the Department with the majority of increases targeted for health care and disability compensation. The FY06 budget proposal includes $750 million for the Capital Asset Realignment for Enhanced Services (CARES) program, bringing the total department investment to date to $2.15 billion. The FY 2006 budget request also calls for a total investment of $2.2 billion in enhanced mental health services, which is $100 million above this year's funding level. This budget proposal will shore up care for veterans with mental health issues, to include comprehensive treatment for those veterans with post-traumatic stress disorder. $1.2 billion will be used for prosthetics and sensory aids, a $100 million increase over FY05. Funding for non-institutional long-term care would increase by more than 18 percent over FY05, with a total investment of $400 million in the President's proposed budget. Department of Energy The FY 06 budget includes $230 million for Weatherization Assistance, to cut the utility bills for lowincome families. The proposed funding for Yucca Mountain Nevada currently undergoing licensing procedures as the nations’ spent nuclear fuel and high-level radioactive waste repository site, has been increased from $572 million to $651 million. The Environmental Management program which oversees nuclear weapons production and energy research site cleanup will be cut back to 6.5 billion from an FY 05 level of $7.2 billion. Tribal lands containing cultural and natural resources are impacted by the radioactive and hazardous waste at many of these sites. NCAI will provide further analysis of the President’s budget proposals for the Departments of Agriculture, Justice, Homeland Security and others as budget documents become available. Updated versions of this broadcast will be posted on the NCAI website at www.ncai.org. NCAI has also posted the FY 2006 Tribal Budget Request at www.ncai.org/data/docs/media/2005/FY06BdgtReqFINAL.PDF . FY 2005 Enacted 1,243,862 119,889 95,165 5,129 19,595 34,224 34,224 11,904 23,808 7,440 FY 2006 Request 1,240,862 119,889 96,294 4,000 19,595 32,624 31,224 6,500 23,808 7,440 Change from FY05 to FY06 -3,000 0 1,129 -1,129 0 -1,600 -3,000 -5,404 0 0
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